Case Study: Jazz Pharmaceuticals v. Amneal Pharmaceuticals

On July 13, 2018, the Federal Circuit decided Jazz Pharmaceuticals, Inc. v. Amneal Pharmaceuticals, LLC (Fed. Cir. Jul. 13, 2018), an appeal of six inter partes review decisions by the Patent Trial and Appeal Board's (PTAB) finding that certain claims of seven patents (U.S. Patent Nos. 7,668,730; 7,765,106; 7,765,107; 7,895,059; 8,589,182; 8,457,988; and 8,731,963) covering a computerized risk-management system for the narcolepsy drug Xyrem were invalid as obvious in light of prior art.

Xyrem, marketed by Jazz Pharmaceuticals, Inc. (Jazz), treats daytime sleepiness and muscle weakness in narcolepsy patients. Xyrem's active ingredient has the potential for abuse as a date rape drug; therefore, the Food and Drug Administration (FDA) only allows restricted distribution of the drug. Because of this abuse potential, during the review process for Xyrem, FDA scheduled an advisory committee meeting to discuss risk management-related issues. A Federal Register Notice, dated May 14, 2001, included an announcement of the committee meeting and added a publicly available hyperlink to an FDA webpage where a user could access background materials, meeting minutes, transcripts, and slides from the FDA meeting (referred to as Advisory Committee Art by the PTAB; hereinafter ACA materials).

Amneal Pharmaceuticals, LLC requested inter partes review of the seven patents owned by Jazz and argued that the ACA materials constituted prior art to the patents. Jazz argued that the ACA materials could not be prior art as they were not sufficiently accessible to the public. The PTAB disagreed with Jazz and found that the materials were publicly accessible, because a person of ordinary skill in the art (POSA) would have been motivated to look for notices related to drug distribution or abuse prevention and would have been capable of locating the ACA materials. On the basis of this prior art disclosure, the PTAB found that certain claims of each of the patents would have been obvious.

Jazz appealed the PTAB's decision to the U.S. Court of Appeals for the Federal Circuit. On July 13, 2018, the Federal Circuit affirmed the PTAB's decision. The primary issue on appeal with respect to the ACA materials was whether they were publicly available before the critical date of the patents. Jazz's principal argument was that the PTAB failed to "make the requisite finding that a [POSA] exercising reasonable diligence could have located the ACA materials." Jazz also argued that...